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Peru ends electoral rift, Castillo pledges stability

  • : Metals, Natural gas, Oil products
  • 21/07/20

Peru's electoral authority certified the victory of rural schoolteacher Pedro Castillo of the leftist Peru Libre party, ending more than 40 days of political uncertainty barely a week before the presidential inauguration.

Castillo squeaked past his conservative rival Keiko Fujimori in a tense 6 June run-off election, 50.1pc to her 49.9pc, according to the official result.

The long wait means Castillo has just eight days to name a cabinet and undertake a transition ahead of the 28 July handover from interim president Francisco Sagasti.

Castillo was conciliatory in first address as president-elect last night, calling on the opposition to unite to lift Peru out of its economic and political crisis and battle the Covid-19 pandemic. He pledged to work within the existing democratic framework and not import any model.

"Together with you, we reject any attempt to bring in a model from another country. Peruvians can develop a true development and economic model, guaranteeing legal and economic stability. We will be respectful of institutions and the constitution," he said.

The vociferous Fujimori campaign had filed multiple judicial challenges to the vote, alleging fraud and delaying the results as her supporters mounted demonstrations. The final challenges were resolved shortly before the National Election Board confirmed Castillo's victory yesterday.

Fujimori said yesterday she would respect the electoral results, but still called Castillo's victory illegitimate and vowed to fight on.

Peru, the world's second-largest copper producer, has been plagued by political turmoil for years. In one week last November, the country had three presidents.

The economy shrank by 11pc last year and Peru leads the world in per capita Covid-19 deaths. The economy is now rebounding sharply, notching 19.7pc growth in the first five months of the year compared to 2020, and the Covid-19 vaccination program is in full swing.

Castillo's opponents, especially in the business community, fear he will nationalize strategic sectors such as mines and natural gas, pointing to his party's nationalist platform that also calls for reviewing free trade agreements. Fujimori exploited such sentiments, hosting Venezuela's right-wing opposition leader Leopoldo Lopez during the campaign to warn against communism.

Castillo has repeatedly denied the far-left ideological label, but he has also insisted that Peru needs a constituent assembly to rewrite the country's 1993 constitution, especially its pro-market economic chapter.

Opponents say such assemblies have helped other Latin American left-wing leaders such as Venezuela's late president Hugo Chavez and his successor Nicolas Maduro to remain in power. Castillo's camp counters that neighboring Chile, with a center-right government, has elected a constituent assembly and is currently rewriting its constitution.


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24/11/08

Japan’s domestic EV sales fall further in October

Japan’s domestic EV sales fall further in October

Tokyo, 8 November (Argus) — Sales of passenger electric vehicles (EVs) in Japan fell for a 12th straight month in October, mostly because of a drop in demand for domestic brands. Sales totalled 4,325 units in October, down by 35.1pc from a year earlier, according to data from three industry groups — the Automobile Dealers Association, the Japan Light Motor Vehicle and Motorcycle Association and the Japan Automobile Importers Association (JAIA). Sales were down by 32.7pc on the previous month. EVs accounted for just 1.3pc of Japan's total domestic passenger car sales last month, down by 0.7 percentage points from a year earlier. The fall in EV sales was mostly the result of lower sales of Nissan's Sakura, one of the domestic producer's top selling EV models. Sakura sales slumped by 51.6pc on the year to 1,448 units. Sales of foreign brand passenger EVs fell to 1,900 units, down by 4pc on the year. The decline largely reflected reduced supply by Germany's Volkswagen, a JAA representative told Argus . It remains unclear if the downtrend will continue given demand for imported EVs remains high in the Japanese market, the representative added. Imported EVs accounted for around 44pc of the country's total passenger EV sales in October. Japan's largest car producer Toyota on 6 November revised its global EV sales outlook downwards to 160,000 units for the current fiscal year that ends 31 March 2025. This is 11,000 units lower from the initial plan announced in May, the company said. By Yusuke Maekawa Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US Fed cuts rate by quarter point: Update 2


24/11/07
24/11/07

US Fed cuts rate by quarter point: Update 2

Updates with recast outlook of results in paragraph 4 Houston, 7 November (Argus) — The US Federal Reserve cut its target interest rate by 25 basis points today, its second cut since 2020, as it said inflation has "made progress" towards its 2pc target. The Fed's Federal Open Market Committee (FOMC) lowered the federal funds rate to 4.50-4.75pc from the prior range of 4.75-5pc. This followed a half-point cut made in mid-September, the first cut since 2020. The Fed has been cutting its target rate from two-decade highs as inflation, which peaked at 9.1pc in mid-2022, has come down to near the Fed's 2pc target. "The Committee will carefully assess incoming data, the evolving outlook, and the balance of risks" in considering additional adjustments to the target rate, the FOMC said in its statement after the two-day meeting. "Inflation has made progress toward the Committee's 2 percent objective but remains somewhat elevated," it said, adding that the unemployment rate "has moved up but remains low." The rate cut comes two days after Republican Donald Trump, a vocal critic of the Federal Reserve during his first term in office from 2017-2021, was elected president. With vote counting ongoing, the Republicans appeared poised to win both houses of Congress, giving Trump his best opportunity to enact his agenda since 2018. Fed chair Jerome Powell told reporters after the Fed's decision that he would not resign before his term ends in 2026 if asked to do so by Trump. He said the president did not have the power to fire or demote Fed chairmen. Trump, during his first term, nominated Powell to his position as Fed chair and he took office in February 2018, according to the Federal Reserve board's website. President Joe Biden reappointed him and he was sworn in in May 2022 for a second four-year term. Powell declined to discuss the incoming Trump administration's policies or "anything directly or indirectly" related to the election during the press conference. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US Fed cuts rate by quarter point: Update


24/11/07
24/11/07

US Fed cuts rate by quarter point: Update

Updates with Powell's comments from press conference after meeting. Houston, 7 November (Argus) — The US Federal Reserve cut its target interest rate by 25 basis points today, its second cut since 2020, as it said inflation has "made progress" towards its 2pc target. The Fed's Federal Open Market Committee (FOMC) lowered the federal funds rate to 4.50-4.75pc from the prior range of 4.75-5pc. This followed a half-point cut made in mid-September, the first cut since 2020. The Fed has been cutting its target rate from two-decade highs as inflation, which peaked at 9.1pc in mid-2022, has come down to near the Fed's 2pc target. "The Committee will carefully assess incoming data, the evolving outlook, and the balance of risks" in considering additional adjustments to the target rate, the FOMC said in its statement after the two-day meeting. "Inflation has made progress toward the Committee's 2 percent objective but remains somewhat elevated," it said, adding that the unemployment rate "has moved up but remains low." The rate cut comes two days after Republican Donald Trump, a vocal critic of the Federal Reserve during his first term in office from 2017-2021, was elected president. With vote counting ongoing, the Republicans appeared set to win both houses of Congress, giving Trump virtually unrestrained powers. Fed chair Jerome Powell told reporters after the Fed's decision that he would not resign before his term ends in 2026 if asked to do so by Trump. He said the president did not have the power to fire or demote Fed chairmen. Trump, during his first term, nominated Powell to his position as Fed chair and he took office in February 2018, according to the Federal Reserve board's website. President Joe Biden reappointed him and he was sworn in in May 2022 for a second four-year term. Powell declined to discuss the incoming Trump administration's policies or "anything directly or indirectly" related to the election during the press conference. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US Fed cuts rate by quarter point, 2nd cut this year


24/11/07
24/11/07

US Fed cuts rate by quarter point, 2nd cut this year

Houston, 7 November (Argus) — The US Federal Reserve cut its target interest rate by 25 basis points today, its second cut since 2020, as it said inflation has "made progress" towards its 2pc target. The Fed's Federal Open Market Committee (FOMC) lowered the federal funds rate to 4.50-4.75pc from the prior range of 4.75-5pc. This followed a half-point cut made in mid-September, the first cut since 2020. The Fed has been cutting its target rate from two-decade highs as inflation, which peaked at 9.1pc in mid-2022, has come down to near the Fed's 2pc target. "The Committee will carefully assess incoming data, the evolving outlook, and the balance of risks" in considering additional adjustments to the target rate, the FOMC said in its statement after the two-day meeting. "Inflation has made progress toward the Committee's 2 percent objective but remains somewhat elevated," it said, adding that the unemployment rate "has moved up but remains low." The rate cut comes two days after Republican Donald Trump, a vocal critic of the Federal Reserve during his first term in office from 2017-2021, was elected president. With vote counting ongoing, the Republicans appeared set to win both houses of Congress, giving Trump virtually unrestrained powers. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

German energy-intensive industry reduces output


24/11/07
24/11/07

German energy-intensive industry reduces output

London, 7 November (Argus) — Production from Germany's energy-intensive industrial sectors was lower in September than a year earlier for the first time in seven months, driven by lower generation from the chemicals sector. Energy-intensive industrial production fell by about 3.3pc in September from August, according to data from German statistical office Destatis ( see data and download ). This was driven largely by a 4.3pc fall in output from the chemicals industry. And overall industrial output was about 1.8pc lower than in September 2023, falling year on year for the first time since February this year. The chemicals industry has warned of lower business confidence in the sector since the summer . Energy-intensive industrial branches previously showed signs of a slow recovery, but general manufacturing output across Germany has been on a consistent downward trajectory in recent months ( see manufacturing index graph ). Manufacturing output across all industrial sectors fell on the month by about 2.5pc, having risen on the month by 2.6pc in August. Third-quarter output as a whole was about 2pc lower than in the second quarter. Industrial economic activity has remained "very weak" recently, German economy and climate ministry BMWK said. But it expects a bottom to form in about the new year. BMWK has predicted that Germany will be in a technical recession in 2024 , before a return to 1.1pc GDP growth in 2025. The German economy started on a downward trajectory in 2022 , triggered by higher energy prices on the back of a halt to Russian gas deliveries to the country. And it has since been hampered by other structural factors such as labour shortages and a high bureaucratic burden. Higher gas prices could drive output lower A steady rise in gas prices in recent months could lead industrial firms to curtail domestic industrial production or use LPG instead of gas for some industrial processes. Argus assessed the German THE everyday price at an average of €40.68/MWh in October, about 56pc higher than the €25.98/MWh in February, the index's lowest point this year. Much higher gas prices since 2022 have driven a drop in Germany's industrial gas demand. Gas use in German industry of 256.5TWh in 2023 was about 22pc lower than the pre-crisis 2018-21 average of 327.6TWh, according to Destatis data released earlier this week ( see sector demand graph ). Firms either curtailed production in reaction to higher prices or switched to LPG in some processes in which gas is used as an energy carrier. But some processes, such as the production of ammonia through the Haber-Bosch-synthesis, use methane as a feedstock, which means they cannot shift to LPG as easily. Gas used as a feedstock reacted more strongly to the energy crisis than the gas used for energy. Gas use as a feedstock in the chemicals industry fell by 36pc in 2023 from 2021, while gas use for energy fell by only a quarter. Many fertiliser producers curtailed capacity in 2023, and Europe's largest fertiliser producer, Yara, expects its European gas costs to rise on the year this winter . The producer has already indicated it will shift its focus towards cheaper ammonia production in the US and away from Europe. Industrial gas use on track to rise in 2024 German industrial gas demand is on course to be higher this year than in 2023, based on daily data ending at the end of October. Industrial gas use for production processes other than space heating was 746 GWh/d in January-October, about 8pc higher than a year earlier, according to Argus estimates. But if September's industrial output drops extend to a multi-month trend, this would pull down the average for this year as a whole. Industrial demand typically falls in December when the holiday period limits economic activity, which could push down the average further. And the collapsed German governing coalition is unlikely to send strong recovery signals to the German economy. German market area manager THE publishes a combined dataset for gas demand by industry and the power sector. Argus splits out power-sector gas demand data by assuming operational efficiencies of 39-42pc, in line with fuel use data from Destatis, and factors out seasonal demand swings linked to space heating by looking at analogue trends in the residential and commercial sector ( see demand split graph ). Argus' estimates diverge from Destatis' annual demand data by only about 1-3pc, except for a 6pc gap in 2021 ( see Destatis vs Argus estimates graph ). By Till Stehr German manufacturing index index, 2021=100 German industrial gas demand by sector TWh German industry and power demand split GWh/d Destatis data vs Argus estimates GWh/d Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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